Unlike PC's or even cars, the internal hardware of video game consoles is not designed to be tinkered with by users. However, that has not stopped enterprising users from doing so. One popular way of tinkering with a console's hardware is to add a modchip (also "mod chip") by soldering it to the circuit board in the console. The modchip allows the gamer to use software that is not intended for use on the console. Primarily, that would include genuine copies of games that are released in a region of the world different from the console's region of distribution (i.e. a regional encoding system, similar to that employed for DVD's); bootleg, backup, or otherwise illegitimate copies of games; and other software that are not illegitimate copies of games but nevertheless not intended for use on the console (e.g. Linux on Microsoft's Xbox console). The console makers, not surprisingly, are not happy that modchips allow gamers to play pirated copies on their consoles, and have taken steps to stop modchip distributors via the legal system. This note will look at the only U.S. case that looks at how the law might apply to modchips. Although the case discussed did not directly involve modchips, it did involve a device that was functionally similar to a modchip, and thus offer a valuable look at the legal issues relevant to modchips.
In Sony Computer Entertainment America, Inc. v. Gamemasters, defendant Gamemasters sold a device called the "Game Enhancer." The Game Enhancer performed at least two functions: allow the gamer to enter codes to cheat in a Playstation game (e.g. getting infinite lives or infinite ammo), and allow gamer to play Playstation games sold in Japan or Europe and intended only for use in Japan or Europe on a U.S. Playstation. Stickers on the Game Enhancer's packaging indicated that it was an external modchip, and the instruction manual mentioned only how to use the game to play legitimate import games. Sony Computer Entertainment America ("SCEA"), however, alleges that the Game Enhancer also allows gamers to play bootleg copies, and sues Gamemasters for, in relevant part, contributory infringement and violation of the anti-circumvention provisions of the Digital Millennium Copyright Act ("DMCA"). The opinion dealt with SCEA's motion for a preliminary injunction in the suit.
In the court's analysis of the contributory infringement claim, it concluded that SCEA did not prove as a matter of law that it was likely to prevail on the merits. The court held that there was insufficient evidence to support SCEA's allegation that the Game Enhancer enabled the playing of bootlegs or Gamemasters' knowledge that the Game Enhancer is used to play bootlegs. Whatever evidence or allegations SCEA had, the court found, supported at most the notion that the Game Enhancer could have been used by gamers to play bootleg copies. Without sufficient evidence of the capability of the device to allow playing of bootlegs or the defendants' knowledge of the device being used to play bootlegs, SCEA could not prove as a matter of law that it was likely to prevail on the contributory infringement, based on the bootleg games argument. Without the bootleg games functionality to support the claim, only the import games functionally provided any basis for the claim. The court, however, held that the consumer's choice to play imported games could not be the directly infringing activity for the contributory infringement claim. The court expressed some skepticism as to whether legitimate games sold and intended for use in foreign countries can become infringing games merely by being transported and sold by third parties. Without the playing of legitimate imported games as the direct infringement, SCEA could not prove that it was likely to prevail on the contributory infringement claim.
The court then looked at the DMCA claim and concluded that SCEA was likely to prevail on that claim. The court held that the Game Enhancer's distinguishing feature, the ability to allow gamers to play genuine Playstation games from other regions, appeared to fall squarely on the type of circumvention prohibited by the DMCA. The court found that the Game Enhancer, by circumventing the regional encoding mechanism, appeared to be a device, whose primary purpose was to circumvent a technological measure that effectively controls access to a copyrighted work. Thus, SCEA was likely to prevail on the DMCA claim and the court granted the preliminary injunction.
Gamemasters highlights two prominent arguments that a game company can use against a maker or distributor of modchips: contributory infringement and violation of the anti-circumvention provisions. Whether, in a contributory infringement claim, the substantial non-infringing uses prong from Sony v. Universal City (the Betamax VCR case) applies to the modchip's ability to allow the playing of genuine imported games is still an open question. Even without the contributory infringement claim, it looks like that game companies can still stop modchips cold by invoking the DMCA. This use of the DMCA is an example of its power to stop piracy-facilitating technology. It, however, is also an example of a major criticism of the DMCA, which is that it gives copyright owners the power to protecting entrenched business models under the pretense of fighting piracy. In the modchips front, the DMCA has allowed Sony to protect its entrenched business model of regionally encoding games made for the Playstation and any successor console, a model that, rightly or wrongly, promotes price and content discrimination between regions of the world.
Resources
- Sony Computer Entertainment v. Owen, 2002 WL 346974 (United Kingdom High Court of Justice Chancery Division 2002): a U.K. case dealing directly with modchips.
- Kabushiki Kaisha Sony Computer Entertainment v. Stevens, 2002 WL 1731077 (Federal Court of Australia 2002): an Australian case also directly dealing with modchips.
- Australian Competition and Consumer Commission (ACCC), www.accc.gov.au. On Feb. 8, 2002, the ACCC announced that it would intervene, in favor of the defendant, in a case brought by Sony involving modchips (presumably it was the Stevens case noted above, since the ACCC participated as amicus curiae in that case). The press release of the announcement is accessible at http://203.6.251.7/accc.internet/digest/view_media.cfm?RecordID=595.
- "Sony PlayStation ruling sets far-reaching precedent," NewScientist.com, http://www.newscientist.com/news/news.jsp?id=ns99991933. News report about the Owen case from the U.K. noted above.
- "Sony loses Australian copyright case," CNET News.com, http://news.com.com/2100-1040-946640.html. News report about the Stevens case from Australia noted above.
- "U.S. crime-fighters seize Web sites," CNET News.com, http://news.com.com/2100-1023-986225.html. News report about a recent U.S. Department of Justice raid on a modchip seller, with the DoJ seizing the seller's web domain as part of the raid.
- In the current DMCA exemption rulemaking process, two comments were submitted in favor of making genuine imported games a class of works that users would be adversely affected in their ability to make nonfringing uses because of the DMCA. Such a classification may make modchips legal under the DMCA. Both Sony Computer Entertainment America and the Interactive Digital Software Association have submitted comments in reply to the two "pro-import" comments, taking positions against the proposed classification.
- "Xbox Linux group seeks Microsoft seal," CNET News.com, http://news.com.com/2100-1040-985154.html. News report about a group's effort to obtain Microsoft's electronic signature so that Linux can run on the Xbox without having to resort to a modchip.
- "Xbox Live to target hackers?," CNET News.com, http://news.com.com/2100-1040-956785.html. News report about Microsoft's Xbox Live online console gaming service possibly blocking out consoles installed with modchips.
